10 Best Programs for First-Time Home Builders in NY

With prices rising and inventory tight, more first-time buyers in New York are choosing to build instead of settling. New construction offers more control, better energy performance, and fewer unexpected repairs – all without the stress of bidding wars.But building your first home isn’t simple. Financing works differently. Finding land takes effort. Zoning laws and permits can slow things down fast.

To help offset the cost and simplify the process, there are programs for first-time home builders in NY that offer real support. These include construction loans, state and local grants, land access programs, and housing education services.

This article breaks down 10 of the most accessible options. If you’re planning to build, start here. These programs can make your path forward clearer and more affordable.

Who Qualifies as a First-Time Home Builder in NY?

Most assistance programs in New York define “first-time” as someone who hasn’t owned or built a primary residence in the past three years. It’s not just for people in their 20s or 30s – many applicants are coming back to the market after renting, relocating, or starting over.

You don’t need to build a massive custom home to qualify. These programs apply to traditional builds, modular homes, and in some cases, self-managed construction. What matters most is that it’s your primary residence, not a vacation home or investment property.

Some programs also include income limits to keep assistance focused on low- and moderate-income households. Limits vary by county and program, so it’s best to check with the specific agency or lender handling the application.

Core Construction Loan Options for First-Time Builders

Financing a new build works differently from financing an existing home. A construction-to-permanent loan – sometimes called a “one-close” loan – covers both the build and your mortgage in one package. You lock in your rate at the start, and the lender releases funds to your builder in phases as work progresses.

Only a few New York State construction loan programs are well-suited for first-time builders.

FHA One-Time Close Loans

If you're building your first home and need a smoother, budget-friendly route, FHA’s One‑Time Close loan wraps your land purchase, construction, and mortgage into a single, low‑down‑payment package – reducing paperwork and saving money from day one. 

• Funding type: Government‑insured loan that combines construction and mortgage in one closing.
• Down payment: As low as 3.5% (580+ credit); 10% if credit is between 500–579. 
• Who benefits: Buyers building a primary residence – including modular or manufactured homes – with lower credit or savings.
• Where to apply: FHA‑approved lenders offering construction‑to‑permanent loans, often requiring a 10‑year builder warranty.
  
  

VA Construction Loans

If you’re a veteran, active-duty service member, or qualifying surviving spouse, the VA can make your first build significantly more affordable. These loans skip the down payment entirely and eliminate private mortgage insurance – often freeing up hundreds per month for your budget.

• Assistance type: VA-insured construction‑to‑permanent loan with 0% down and no PMI.
• Benefits: Low-to-no down payment, no PMI, competitive rates – but lenders are limited and approval depends on builder experience. 
• Who benefits: Eligible veterans, active duty military, or qualifying spouses, financing a primary residence built on owned or purchased land.
• Where to apply: VA-approved lenders experienced in construction loans, working with VA‑approved builders.
  
  

Conventional Loans (HomeReady® and Home Possible®)

For first-time builders with solid credit and steady income, Fannie Mae’s HomeReady® and Freddie Mac’s Home Possible® programs offer an affordable way in. Low down payments and income-based flexibility make them appealing if you can meet the credit bar. 

Plus, they work with construction-to-permanent financing, so you’re not juggling multiple loans.

• Assistance type: Conventional construction‑to‑permanent loans with 3% - 5% down, depending on program and lender.
• Best for: Borrowers who meet credit and income requirements and want flexibility without PMI or federal paperwork. 
• Who benefits: Buyers building a primary residence with good credit history and stable finances. (Income limits may apply.) 
• Where to apply: Participating conventional lenders familiar with HomeReady® or Home Possible® programs and construction loans.

State-Level Grant & Subsidy Programs for Construction

Beyond loans, there are also NY State land and construction assistance programs that reduce the cost of building. These are typically administered through nonprofits or local governments and are aimed at keeping new housing affordable for low- to moderate-income residents.

NYS HOME Homebuyer Development Program

If you qualify as low- to moderate-income and are buying from a nonprofit builder, the NYS HOME Program can cover a huge chunk of the construction cost. The state funds nonprofit developers to build single-family homes, then sells them to qualified buyers at affordable prices. In many cases, part of that funding is forgivable – meaning you won’t have to pay it back if you meet the terms.

• Funding available: $10 million statewide in 2024
• Grant amount: Up to $250,000 per project
• Who benefits: Low- to moderate-income first-time buyers purchasing from nonprofit developers
• Where to apply: Through nonprofit housing developers funded by NYS HCR.
  
  

Affordable Home Ownership Development (AHOD)

If you're part of a nonprofit, housing authority, or local government, AHOD helps turn that affordable housing vision into reality – funding the construction, rehab, or improvement of homes for low- to moderate-income families across New York State. The grants flow to developers, who then work closely with eligible buyers to deliver homes at manageable prices. 

• Funding available: About $26 million allocated for FY 2025–2026. 
• Assistance type: Grants to nonprofits, municipalities, housing authorities, etc., for building, acquiring, rehabilitating, or improving homes.
• Who benefits: Low- and moderate-income families – but grants go to developers who must ensure buyers qualify. 
• Where to apply: Through New York State Affordable Housing Corporation (via Homes & Community Renewal), for approved nonprofit or public sponsors.
  
  

Accessory and Alternative Construction Support

Some first-time builders in New York are starting with smaller lots, inherited property, or land in city neighborhoods. Two programs stand out for making these kinds of projects more realistic.

Plus One ADU Program

Want to add an in-law suite, backyard cottage, or garage apartment to your property? The Plus One ADU Program helps low- and middle-income homeowners build – or legalize – Accessory Dwelling Units with support from municipalities and nonprofits, aiming to streamline design, construction, and code compliance. 

• Funding available: Part of an $85 million five‑year grant program.
• Assistance amount: Up to $125,000 per homeowner for ADU design, construction, permits, and related costs.
• Who benefits: Low- to middle-income homeowners in participating municipalities, working through local program administrators. ADUs must be for long-term occupancy (not short-term rentals) and monitored for at least 10 years.
• Where to apply: Through local governments or nonprofit housing partners acting as Local Program Administrators.
  
  

Local Land Bank Lot Sales

Some New York land banks sell vacant residential lots at steep discounts, sometimes for just $1. Buyers agree to build within a set timeframe and often complete a homeownership course before starting construction.

• Lot prices: $1 to $5,000, depending on location and lot size.
• Eligible buyers: Must commit to starting construction within 12–18 months of purchase.
• Requirements: May include HUD-approved homebuyer education, proof of financing, and build plans.
• Where to apply: Through your local city or county land bank. See also the New York Land Bank Association directory.
  
  

Regional Programs for Western NY First-Time Builders

Western New York has two strong regional programs designed to help first-time builders finance and complete their projects.

NeighborWorks® Community Partners – Buffalo & WNY

If you're starting your first build in Western New York, NeighborWorks® gives local support – like financial coaching, land access help, and planning assistance – to guide you from blueprint to move-in.

• Services provided: Land acquisition help, budget coaching, and program referrals. 
• Who benefits: First-time builders in Buffalo and surrounding counties – especially income-qualified applicants. 
• Cost: Services are generally free for income-qualified clients.
• Where to apply: Through NeighborWorks® offices in Buffalo, Rochester, or Niagara Falls.
  
  

Belmont Housing Resources for WNY

If navigating builder contracts and land options feels overwhelming, Belmont Housing Resources offers counseling, development partnerships, and land trust access to help you get started in Buffalo and Western New York.

• Services provided: Housing counseling, land trust access, and development partnerships.
• Who benefits: First-time builders and buyers in Western New York (Buffalo metro and surrounding areas).
• Cost: Counseling is free; development costs vary depending on the project.
• Where to apply: Through Belmont Housing Resources’ Buffalo office or website.
  
  

Planning & Education Support

For first-time home builders, education and planning can save time, money, and stress. Several programs in New York focus on preparing you for the construction process – covering everything from budgeting to permits.

HUD-Certified Home Construction & Ownership Counseling

Many loan and grant programs in New York require HUD-approved counseling before they release funds. These courses teach the financial, contractual, and procedural steps of building a home so you can navigate the process with confidence.

• Cost: Often free for income-qualified applicants; typically $50–$150 for others 
• Format: 6–8 hour sessions, in person or online, through HUD-approved counseling agencies.
• Covers: Budget planning, mortgage prequalification, contractor selection, contract review, and scheduling inspections.
• Where to find: Use HUD’s counseling agency directory or contact local nonprofit housing organizations.
  
  

Nonprofit and Municipal Workshops

Local housing offices and nonprofits in New York sometimes host workshops that guide first-time builders through zoning approvals, permits, contractor vetting, and code compliance. Some programs invite lenders and builders to help participants start building connections early in the process.

• Cost: Typically free for residents; $20–$50 for multi-session courses.
• Format: One-day events or multi-week evening classes offered by housing offices, planning departments, or nonprofits.
• Focus areas: Zoning and permit checklists, contractor bidding, meeting state and local code requirements, and using local incentives.
• Where to find: Contact your city or county’s housing or community development department or local planning office.
  
  

6 Steps to Start Your First Home Build in New York

Once you know which programs can help, the next step is putting a plan in motion. These steps can take you from researching options to starting your build.

1. Map your timeline and budget

2. Secure land or explore land bank opportunities

3. Choose a lender with construction loan experience

4. Work with a builder and select your floor plan early

5. Connect with nonprofit or municipal housing partners

6. Complete a homeownership course and get prequalified

1. Map Your Timeline and Budget 

Start with realistic estimates for land preparation, permits, financing, and construction. Knowing your numbers early will help you avoid delays later. A clear budget and schedule also make it easier to communicate with lenders, builders, and local agencies throughout the process.

2. Secure Land or Explore Land Bank Opportunities

Land banks often sell infill lots at low prices, sometimes for just a few hundred dollars. They can be a practical entry point for first-time builders.

Before purchasing, carefully review zoning rules, available utilities, and location to make sure the lot fits your plans.

3. Choose a Lender with Construction Loan Experience

Not all lenders handle construction financing. Ask if they offer one-close construction loans and whether they’re familiar with combining state or local grant programs with your loan package.

4. Work with a Builder and Select Your Floor Plan Early

Choosing a builder early lets you shape the project with someone who understands your budget, timeline, and local requirements, reducing the chance of delays.

Finalizing your floor plan simultaneously streamlines permits, financing, and material orders, helping the build stay on schedule.

5. Connect with Nonprofit or Municipal Housing Partners

These organizations can help you navigate applications, line up workshops, and connect with additional funding. Many also provide one-on-one counseling for first-time builders.

6. Complete a Homeownership Course and Get Prequalified

Most assistance programs require a HUD-approved homeownership course. Taking it early ensures you meet eligibility requirements.

Prequalification also gives you a clear picture of what you can afford, helping you plan with confidence.

Programs for First-Time Home Builders in NY Can Help You Start

Building your first home in New York comes with challenges, but the right support can make it achievable. The programs for first-time home builders in NY we’ve covered can reduce costs, open financing options, and connect you with partners who understand the process.

Focus on the programs you qualify for, follow a step-by-step plan, and stay realistic about budget and timing. With preparation, your first build can move from an idea to a finished home.

Learn More About Financing Your First Home Build

Understanding your loan options is one of the most important steps in turning your plans into a finished home. Our free guide walks you through the process of securing a new home construction loan, so you can move forward with confidence.